MACROECONOMICS

Alexander LUKASHENKO:
A Shock Therapy
Is Not an Option

Despite the serious challenges in the economy and the financial market, Belarus’ social priorities will remain intact. Economic policy priorities will not be changed: a shock therapy is not acceptable for Belarus. Belarus President Alexander LUKASHENKO made the statement during the open dialogue with Belarusian and foreign reporters in late January. The conversation between the Belarusian head of state and the mass media community covered all kinds of topics. A large number of the questions were focused on the country’s social and economic development.

At the end of 2014 Belarus had to deal with serious challenges coming from abroad. Market slump and steep devaluation of the national currencies of Belarus’ main trading partners, plunging prices for oil and oil products, and the escalation of the Ukraine conflict prompted the Belarusian Government to look for new growth points and new solutions to improve the economic regulation system. To confront external shocks, the Government came up with an action program for 2015. Taking part in the elaboration of the document were MPs and the business community. In the face of mounting external challenges, the focus was made on maintaining macroeconomic and social stability and creating the foundation for the further economic growth.

The government action program for 2015 is a systemic document that reflects an entire set of interconnected measures in macroeconomic policy, foreign economy policy, structural policy, investment policy, industry­wise policy, regional policy, and social policy.

Tatyana GRIGOROVICHBelarus’ Development Outlook

At the start of February 2015 the Presidium of the Council of Ministers approved the national strategy for Belarus’ sustainable social and economic development for the period until 2030. Some provisions of the document have yet to be finalized. However, overall the document is clear in its purpose. The national strategy sets forth Belarus’ key priorities and development targets for the next 15 years as part of a triad – people, economy, and environment. The document spells out objectives, stages and mechanisms of Belarus’ transition towards a mature civil society and innovative economic development and guarantees favorable conditions for personal growth, higher living standards and safe environment.
One of the developers of the strategy, Director of the Economy Research Institute of the Belarusian Economy Ministry Alexander CHERVYAKOV tells the Economy of Belarus Magazine how the strategy will be implemented and how it is expected to transform Belarus by 2030.

IN THE SPOTLIGHT

Anatoly KALININIndustries of Everyday Importance

Reviewing the Government’s efforts to reform the construction industry, housing and utilities sector and transport industry.

QUESTIONS TO THE MINISTER

Tax News

These days the role of taxation is being dramatically revised as taxes are more often viewed as an instrument to stimulate the private sector and the economy in general. Tax benefits can help promote innovations, raise investments and boost export… Moreover, taxes generate more than 70% of state budget revenues. How to achieve a balance of interests of taxpayers and the state? What tax regulation mechanisms will come to the forefront in the near future? These and other questions have been addressed by the Economy of Belarus Magazine to Minister of Taxes and Duties of the Republic of Belarus Sergei NALIVAIKO.

FOREIGN ECONOMIC TIES

Irina KONTSAVENKOFrance is Becoming Closer

The relations between Belarus and France have become more defined recently. A testimony to that is the first session of the Belarus–France economic cooperation commission hosted by Minsk. The partners had been working to set up a commission like that for many years.
One of the major objectives of Belarusian diplomatic missions abroad is to represent the country’s economic interests. One of the priorities of the French Foreign Ministry is promoting economic diplomacy. Ambassador Extraordinary and Plenipotentiary of Belarus to France Pavel LATUSHKO believes that the similarity of interests can be highly instrumental in advancing cooperation between the two countries. The diplomat tells the Economy of Belarus Magazine about the instruments used to promote the bilateral trade and economic contacts, about Belarus–made products that enjoy a high demand in France, cooperation prospects with Peugeot–Citroen and the time when French bikers will roam Belarusian roads.

Building up export potential is vital for Belarus as the country’s prosperity depends on the efficient operation of exporting companies and smart product promotion. One of the major goals of the Belarusian Chamber of Commerce and Industry (BCCI) is to help manufacturers secure a foothold on traditional markets and to explore new export destinations. BCCI Chairman Mikhail MYATLIKOV tells the Economy of Belarus Magazine about the work of the Chamber, challenges facing exporters and the secret behind effective sales promotion.

BANKS AND FINANCE

Anna KOTPremium­Quality Service for VIP Customers

They say silence is the sound of money talking. Money also likes comfort and custom–tailored service. Private banking that emerged in Western Europe about three centuries ago as a way to provide services to high–profile clients confirms the statement. Later on premium–quality banking was made available in the former USSR. This kind of services emerged in Belarus after Russia and Ukraine. It is typical that the banks partially or wholly owned by foreign financial bodies with a record of servicing wealthy clients were the first to explore the new branch of the banking business. Experts say that VIP banking in Belarus is in its nascent phase but already enjoys solid demand. The number of clients interested in luxury services rises steadily.

The reduction of cash turnover and promotion of cashless payments using bankcards is one of the key objectives facing the Government and the National Bank of Belarus. Many countries are working to discourage cash transactions in a bid to cut down on costs associated with paper money printing and to pull the rug from under shady businesses. Naturally in the vanguard of the efforts are banks issuing and servicing bankcards.
What are Belarusian banks doing to promote payments using bankcards? How can a bank encourage its customers to switch to plastic? These and other questions were addressed by the Economy of Belarus Magazine to Deputy Chair of the Board of Belarusbank Tatyana MIKHAILOVSKAYA.

IT AND COMMUNICATIONS

Price for Web Hosting Services in Belarus

As of 9 January 2015 the registration of websites in Belarus costs money. Who will pay 50% of the base amount, why it costs that much, and what it means for website owners has been explained by the State Supervisory Department for Telecommunications of the Republic of Belarus (BelGIE).

Watch Out for Fraud!

In addition to improving the quality of communication and increasing the number of services available, the rapid development of telecommunication technologies enables conditions that, unfortunately, allow scammers to earn money at the expense of legal subscribers by interfering with the delivery of services. More frauds have been registered on the Belarusian telecommunications market recently. Beltelecom representatives revealed why phone scammers tend to generate calls to Monaco and Serbia and how subscribers can determine whether they are involved in illegal
traffic termination or not.

FOOD INDUSTRY

Irina KONTSAVENKOStrategy for the Dairy Industry

Belarus is recognized as one of the world’s dairy industry leaders. The quality of Belarusian dairy products is second to none. Indeed, those who buy our products get the best value for their money. The country is one of the world’s five biggest exporters of dairy products. None of the former Soviet Union republics can boast such an achievement. Belarus has set an ambitious goal for 2020 – to increase milk production from today’s 5.8 million tonnes up to 9 million tonnes. What are the prospects for the domestic dairy industry and what sales markets should we focus on?

Tamara MARKINAMinsk Oblast Brand

According to experts, one of the major achievements of the Belarusian economy in the past 20 years is a significant production growth and dramatic improvement of the technological level of domestic agricultural and processing companies. A huge amount of money has been invested in the industry. However, the payback has also been tremendous.
The ultimate goal is food security of the country. However, the export of meat and dairy products is just as important.
Taking into consideration that there are not so many vegetarians in Belarus and abroad, the country that can produce enough milk, cheese, butter, meat and sausages to meet the domestic and foreign demand has great prospects. This country will always be reckoned with.

Every company has its own history, its own destiny. Periods of comparative calm alternate with vigorous growth and vice versa. In Vitebsk there is an enterprise worth paying attention to due to many reasons. The best reason is the fact that the company has managed to advance to the forefront within a few years. Some time ago it used to be a lot less recognizable and noticeable. But changes enacted in the last few years got the business moving and now life is in full swing over there. That enterprise is OAO Moloko also known as Vitebsk Moloko, which also happens to be the company’s top trademark. The appearance of the trademark virtually heralded the second coming of the company.

FLAGSHIPS OF THE ECONOMY

Over the past 15 years the global metallurgy has experienced at least three major recessions. Every recession was followed by a sharp decline in prices for metal products, from 30% to 70%. The development of the steel market was not always in synch with similar processes going on in the global economy.

Quality Breaks Stereotypes

Belarusian tires are well known far beyond our country. Due to their optimal value for money ratio, Belarus–made tires sell well in 65 countries. The geography of sales is growing bigger. Today Belshina is one of Europe’s biggest tire producers. The company is implementing several upgrade projects that will enable it to compete on equal footing with the world’s industry leaders. Belshina Director General Alexei Yakovlev tells the Economy of Belarus Magazine about the company’s new products, issues facing the industry and efforts to win the trust of Belarusian customers.

Anna KOTTriple­Nine
Black Gold

Mozyr Oil Refinery is a rapidly developing enterprise and is one of Belarus’ largest taxpayers. Founded in 1975, within 40 years the refinery has gone all the way from producing the first gasoline in Polesye to offering the wide choice of European–quality products. Last year the enterprise processed over 12 million tonnes of oil, increasing the oil conversion ratio up to 72% and the output of light oil products up to 60%. The performance standards are some of the best in the post–Soviet space. Gasoline and diesel fuel made by Mozyr Oil Refinery are now compliant with Euro 5 standards. The quality of oil products that allows the company to successfully compete in the European Union and the Commonwealth of Independent States is secured through regular modernization.

INNOVATIONS

Snezhana MIKHAILOVSKAYAYouth. Science. Innovations

This was the motto of the nationwide congress of the scientific community timed to the Day of Belarusian Science. Attending the event were representatives of the National Academy of Sciences of Belarus (NASB), the Education Ministry, and the State Science and Technology Committee. They all reiterated that our country is implementing system–based research projects and has already come up with some unique solutions. Besides, innovative world–class research centers and production facilities are being set up in Belarus. However, it is also obvious today that no major progress can be made without young scientists able to offer out–of–the–box solutions. The country pins great hopes on the intellectual potential of young researchers, their creative thinking and ability to generate innovations.

REGIONAL NEWS

Anna KOTResults­Oriented Work

Located near the Lithuanian border, Oshmyany District is one of the most dynamically developing districts of Grodno Oblast. Local authorities try to make the most of the geographical location and tourist potential of the district in order to lure foreign and domestic investors. Biking tourism, wind mills, production of eco–friendly disposable dinnerware, growing of blueberries and cranberries – these are just some of many ideas that can arouse interest in potential investors. This approach really works. As the district celebrates the 75th anniversary of its founding, Chairman of the Oshmyany District Executive Committee Miroslav SAROSEK tells the Economy of Belarus Magazine about the projects currently in progress in Oshmyany District and about the business plans in the pipeline.

LABOR MARKET

Yelena PRUSNo Panic!

Until recently the Belarusian labor market could be compared to an oasis of calm. The registered jobless rate was three times lower than the projections. The number of vacancies was two or three times bigger than the number of job seekers in Belarus in general and ten times bigger in Minsk. Some would even say that there is no need for employment services as those who want to work will be able to find a job easily having such a broad choice of vacancies… These people disregarded a simple fact: the labor market is a very volatile sector that promptly responds to any changes in the social and economic situation in the country and the neighboring states and is very sensitive to demographic trends. Indeed, it was too early to let our guard down: the period of the long–term calm on the labor market was over. However, there is no reason for panic. A storm is a very unlikely possibility as the sky is still clear. If needed, employment services will make use of the broad range of mechanisms they acquired over the 30 years of work.